Kohl's has announced the closing of 27 out of about 1200 stores nationwide. Someone who appeared to know what he was talking about said getting ready to buy it b/c this new CEO has been famous for mergers and what they are going to do is merge and the price will go from around $13 to $50. He got in to how they own a lot of their store buildings which plays a role in their actual stock value. Does anyone believe that or have a similar theory?

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Posted by bigjoe1

Member since Jan 2024

1489 posts

Posted on 1/13/25 at 8:16 am to carguymatt

The value of KSS and M is in the real estate. Over the years, various VC's have approached both companies about selling the RE and then leasing it back. Effectively leveraging the remaining company to the eyeballs.
So far, nobody seems to be able to make the numbers work.
America is just way over stored a so to speak. Just don't see mid sized retail stores commanding a premium when Amazon and Walmart have such a large market share.

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Posted by HagaDaga

Member since Oct 2020

6000 posts

Posted on 1/13/25 at 12:30 pm to carguymatt

Could it be a response to the recently announced JC Penny M&A activity?

27 stores doesn't make much sense for M&A reasons, unless we know where they are at, especially since there are ones that are dealing with laxed theft laws. 27 could be ones in bad areas. Don't know if the market has reacted to this, but my newb thinking is that this would be looked as a positive either way.

This post was edited on 1/13/25 at 12:31 pm

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Posted by makersmark1

earth

Member since Oct 2011

20447 posts

Posted on 1/13/25 at 1:23 pm to carguymatt

A positive for Kohl’s as they do Amazon returns.

Retail is iffy unless it is very high end, specialty, elite.

I am not a buyer so it could go to the moon.

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Posted by LSUFanHouston

NOLA

Member since Jul 2009

40252 posts

Posted on 1/13/25 at 1:50 pm to bigjoe1

quote:
Over the years, various VC's have approached both companies about selling the RE and then leasing it back. Effectively leveraging the remaining company to the eyeballs.
So far, nobody seems to be able to make the numbers work.

Well it works great for the VCs provided they can drop it before the company can no longer afford to pay rent.

You are getting short term money for a never ending long term expense, so unless you invest that money in a way that allows for more future net income than the never ending rent expense, it's not going to work.

Like with Sears / Kmart, it just delayed the inevitable, because they did not take the money to fix what was broken.

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